I got this tip from Tim Hart of FoamyFactory.com fame. I use Crystal Clear (Laser) full sheet labels from OnlineLabels.com (product OL175CL). I am fortunate enough to have a color laser printer at home so they work great for me and don run with water since they are baked on during the laser printing process. Also, they are very resistant yet lightweight. They key here is that they are clear and only work on white foam since whatever is behind them shows through.
I'm not sure if there is something equivalent in Europe but I can only imagine that there is.
As for the graphics themselves any number of graphics programs will do. I happen to have an old version of AutoCad that I design my planes in. I export the section to be decorated to a .eps file and then import it into an old version of Macromedia Fireworks (you need to make sure you import to the correct size canvas because .eps is a size independent file format). Here is where I design my graphics and then just print them to the labels, cut them out and stick them on. If possible I will also run a covering iron on them to further activate the glue and get a stronger bond to the foam (I do this with all my tape joints as well, e.g. hinges).
They key to good decals is artistic talent. I unfortunately don't have very much artistic talent. I am however very good with computers so I make up for it using advanced program features like gradient fills and edge effects.
If you want further details I may be talked into making a tutorial video and posting it to YouTube. If what you were looking for is the tip on the label stock well there it is.
Hope this helps.